26.06.2019 – Daily report. The optimists are back on track. Although there is a bouquet of unsolved problems hovering above the German stock market, the DAX wants to rise. Despite the Iran crisis and the customs dispute between China and the USA. And, of course, despite the heat wave over Frankfurt that paralyzes everything.
Buying mood on Main
Bad is good on the Frankfurt Stock Exchange: Brokers immediately reinterpreted negative economic signals from Germany into new arguments for a loose monetary policy. By midday, the DAX had risen by 0.6 percent.
Previously, the market research company GfK had reported that the buying mood of German citizens had declined for the second time in a row in June. For July, the experts forecast a consumer climate of 9.8 points after 10.1 points in June. All economic data can be found here: Market Mover
Restraint in Asia
Investors in Asia were cautious in the morning. Before the G20 summit in Osaka, only a few traders wanted to take new positions. The Nikkei 225 also lost ground on Wednesday, losing 0.5% at 21,087 points. In contrast, Hang Seng rose by 0.1 percent to 28,222 points. Hardly any broker currently believes that there will be an agreement between China and the USA. In addition, the sharp tones from Washington towards Iran slowed the bulls.
New tension in the oil market
US President Donald Trump tested the nerves of CFD traders in the oil market on Tuesday. Trump announced on Twitter that every attack by Iran on Americans would be answered “with great and overwhelming force”. In some areas this could also mean “extinction”. So please keep an eye on the real-time prices of Brent and WTI on your trading platform. In the Persian Gulf, the situation can escalate subito. Especially since the OPEC meeting with its allies could bring news on oil.
Losses in New York
The Iran issue had already slowed the buying mood in New York the previous evening. The Dow Jones Industrial closed Tuesday down 0.7 percent at 26,548 points. The S&P 500 crumbled by one percent to 2,917 points and the Nasdaq 100 even lost 1.7 percent to 7,592 points.
Mixed signals from the Fed
Fed Chairman Jerome Powell had shown himself open to interest rate cuts before the Council on Foreign Relations in New York. However, he stressed unusually clearly the independence of the central bank – a clear side blow against Trump’s pushing for a rate cut. In addition, James Bullard, President of the Fed in St. Louis, dampened interest rate fantasies. In an interview with Bloomberg, he called the hope of a rate cut of 50 basis points in July “exaggerated”.
Bitcoin wants to go up
Meanwhile, the crypto currency Bitcoin continued to rise. The price approached the $13,000 mark. The reason for this is Facebook’s plans for its own virtual currency.
This is what the day brings
The appointment calendar is rather manageable in the middle of the week. New orders for durable goods are reported at 14.30 in May. And at 16.00 the weekly oil report of the Ministry of Energy follows.
The Bernstein Bank wishes you successful trades!
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